Adam Posen Has a Warning on the Danger of Bidenomics

Odd Lots

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4.4 • 1.6K Ratings

🗓️ 30 August 2023

⏱️ 53 minutes

🔗️ Recording | iTunes | RSS

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Summary

The Biden administration has undertaken an aggressive effort to revitalize domestic manufacturing, particularly in areas like semiconductors and green technology. The reasons are manifold. The pandemic exposed frailties in the supply chain. Climate concerns have accelerated the urgency around the energy transition. And anxiety about growing Chinese dominance in key areas (such as batteries) has heightened geopolitical concerns. So now, day after day, we see spates of announcements of new factories being opened up in these areas. But what are the risks and dangers to this approach? On this episode of the podcast, recorded at the Jackson Hole Economic Symposium, we speak with Adam Posen, a former member of the Bank of England's Monetary Policy Committee who now serves as president of the Peterson Institute for International Economics. He warns that the basic logic for this domestic industrial policy is misguided and based on a faulty understanding of domestic economic dynamics. He also says that we're taking a wrong and dangerous approach to dealing with perceived competitive threats from China.

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1:08.8	Hello, and welcome to another episode of the OddLots podcast. I'm Joe Wisenthal,
1:14.0	and I'm Tracy Alloway. Tracy, you know, we're still here at Jackson Hall. We're hanging on.
1:19.7	We're not really in the actual event space, so we're just sort of hanging out in the lobby,
1:24.1	looking for people as like, hey, do you want to come on the podcast? And we found a person.
1:28.1	We found a person. We have the perfect guest, actually, but one thing I'm really excited,
1:32.0	you know, we've, one of the things we've been talking about already is this idea that,
1:36.4	you know, monetary policy is always challenging. It's always challenging when you have things like
1:41.8	COVID, the war, et cetera, but we're also in a period in which fiscal policies, macro policy,
1:48.7	trade policy, industrial policy, these things that we talk about on OddLots all the time,
1:54.1	like, how do central bankers deal with them? Absolutely. I feel like I've said this a number
1:58.1	of times at this point, but one of the themes of this meeting seems to be how do central bankers
	...

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